When you can’t fight them, join them.
C.Jay Engel writes about how Chinese central bank is embracing blockchain technology:
The recent news in the Bitcoin world is China’s building attempt to regulate and oversee its use to a point where it is rendered nearly useless for Chinese consumers. They’ve realized that they can’t truly kill it per se, but they can regulate the exchanges to a point where they can effectively stymie ts attractiveness.
Bitcoin, whether one considers it sound money or not, is a challenge to the established system monopolized by central banks everywhere. The War on Cash narrative fits in with the reality that central banks and governing authorities feel a need to address the lack of control and centralization in the currency world. Just as Bitcoin challenges the use of government protected clearing systems, so cash allows some inkling of freedom by consumers to withdraw from central-bank-driven monetary insanity.
It is no surprise that monetary bureaucrats worldwide have all but declared war on these “alternatives.” It’s all about control — about knowing what everyone is up to at all times. Instead of allowing the individuals to choose on the market, central bankers are all over the budding technology. They want to both challenge the existence of alternatives (Bitcoin) and embrace the technology behind it.
The New York Times observes, creepily:
For the central banks, the promise of the technology is that it would allow them to track every pound or renminbi on every step of its travels through the financial system in real time — something that is impossible now. The goal would be to make the financial system more transparent, fast, efficient and secure.
Indeed, while declaring war on Bitcoin itself, we discover that Chinese banks are experimenting with their own central-bank-approved version of a purely digital currency.